Behind the Ticker: RIET and HOMZ
After spending a decade trading REITs at Green Street Advisors and watching the ETF industry grow up from the inside at Esposito Securities, David Auerbach, CIO of Hoya Capital, now runs two REIT-focused ETFS, HOMZ and RIET.
Behind the Ticker offers investors a chance to get under the hood of newer or more niche ETFs. Brad Roth, Managing Partner and CIO of Thor Financial Technologies, talks strategy and the human side of investing and ETFs with the individuals bringing these funds to market.
In this episode, Roth sits down with David Auerbach, CIO of Hoya Capital to talk the Hoya Capital High Dividend Yield ETF (RIET) and the Hoya Capital Housing ETF (HOMZ). Auerbach breaks down why most advisors are thinking about REITs wrong, digging into why the top REIT ETFs are more concentrated than you think, where the real value sits in small- and mid-cap REITs, why 4% on the 10-year Treasury is the magic number, and how a wave of M&A is creating opportunities across the sector. Auerbach also explains how RIET delivers a 10%+ annualized monthly dividend by going where the big passive funds won't–into small-caps, mortgage REITs, and REIT preferreds.
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RIET, HOMZ, and Hoya Capital
David Auerbach is the Chief Investment Officer at Hoya Capital, a REIT-focused ETF issuer managing approximately $135–$140 million across two funds. David spent over a decade trading REITs at Green Street Advisors in Dallas, Texas, starting on the day the NASDAQ crashed in March 2000. After Green Street, he moved to Esposito Securities, where he had a front-row seat to the explosive growth of the ETF industry, working with emerging issuers that are now household names. Following stints launching residential REIT ETFs — including ringing the closing bell at both the NASDAQ and NYSE within weeks of each other — David joined Hoya Capital in September 2023 when the firm had around $75 million under management. Outside of work, David is a devoted fan of the rock band Phish, approaching 250 live shows with a goal of hitting 100 more before they retire.
Hoya Capital originated over a decade ago when David's partner, a Georgetown alum, began writing REIT research on Seeking Alpha during its early days when fewer than a handful of writers covered the sector. The visual, data-rich research style built a substantial subscriber base, which eventually led to interest in launching ETFs. The first fund, Homes (HOMZ), launched during COVID to capture the U.S. housing market broadly. Client demand for more income-focused exposure led to the creation of the second fund, REIT (RIET).
The Hoya Capital Housing ETF (HOMZ) is a growth-oriented ETF designed to play the housing supply-demand imbalance. It provides one-wrapper access to home builders, residential REITs, service providers, brokers, agents, and retailers like Home Depot and Lowe's. The thesis is straightforward: the U.S. is roughly five to six million homes short of meeting demand, and until builders deliver more affordable product (think $300K homes instead of $500K), the housing trade has legs. David also pointed to the emerging rent-to-own model and the growth of single-family rental REITs as tailwinds.
The Hoya Capital High Dividend Yield ETF (RIET) is an income-focused ETF paying a monthly dividend currently annualized at over 10%. The fund deliberately inverts the weighting of traditional REIT ETFs like VNQ and IYR — instead of concentrating in large-cap names yielding 2–3%, RIET overweights small caps, mid caps, mortgage REITs, and REIT preferred stocks. The portfolio holds roughly 100 names with a maximum position size of about 1.5%. One-third of the portfolio (approximately 10% weighting) is allocated to liquid REIT preferred stocks, which David believes makes it unique among REIT ETFs on the market. The selection process incorporates a quality scoring system across management, operations, transparency, and communication, along with geographic and sector diversification constraints. Rebalancing follows a "last in, first out" approach focused on the bottom 5–10 holdings.
To learn more about Hoya Capital's ETFs, go to HoyaCapital.com or connect with David Auerbach on LinkedIn.
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Disclaimer: The market insights, projections, and investment strategies expressed in this article are solely those of the contributor and do not necessarily reflect the views or opinions of ETF.com This content is provided for informational purposes and does not constitute financial, investment, or legal advice.
